Chinese consumer price inflation moderated in December but upstream price pressures surged as a result of higher commodity prices.
According to China’s National Bureau of Statistics (NBS), consumer price inflation (CPI) rose by 0.2% in December, leaving the increase from a year earlier at 2.1%.
It was expected to increase by 2.3%, unchanged from the pace reported in November.
However, while CPI pressures eased, it was a vastly different story for upstream price pressures.
Over the same period, producer price inflation (PPI) surged by 5.5%, a figure well above both the 3.3% level of November and expectations for an increase of 4.5%.
Producer price inflation is a measure of the cost of raw inputs for the industrial sector.
It was the fastest annual increase seen since September 2011.
Much like then, producers prices have been supported recently by higher commodity prices, partially as a result of a rebound in Chinese residential and infrastructure investment.
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